Flipkart's first customer almost didn't get his book

Flipkart had tied up with two book distributors in Bengaluru, but an error in the back-end software script meant that their website showed even the older databases of the distributorsAnand J&Shalina Pillai | TNN | Updated: July 31, 2017, 10:56 IST

Ten years ago, a Mahbubnagar resident ordered a book online. He had no idea then that he was the first customer on a site that would go on to become India's biggest retailer.

V V K Chandra, a freelance web consultant in Mahbubnagar, was also a tech blogger and voracious reader. Books were difficult to get in Mahbubnagar, so he would make frequent trips to Hyderabad, 90 km away, to buy the books he was keen on.

In October 2007, below a blog he had just written, the 25-year-old found that someone by the name Sachin had left a comment, and a website link: flipkart.com. Intrigued by the link, Chandra clicked on it, and it took him to an online book store that promised to ship books anywhere in India.

It was a good website by the standards of those days. Chandra would know, since he was a web consultant. Coincidentally, he was at the time looking for John Wood's memoir Leaving Microsoft to Change the World. He had looked for it in Hyderabad, and it wasn't available. He searched flipkart.com, and it was listed.

“The design of the website, the good collection of books gave me confidence that the people behind it could be trusted. It was a bit of a risk, but the book was only Rs 500 and I could afford to lose it,“ he told TOI on the phone from California, where he now works. He placed an order, paying for the book online using a credit card. He had no idea then that he had just become Flipkart's first customer.

At the other end, in an apartment in Koramangala in Bengaluru where Flipkart founders Sachin Bansal and Binny Bansal stayed with two other IIT Delhi batchmates, there was palpable excitement. “We were completely over the moon, and perplexed about where the order had come from,“ recollects Binny. Till then, the only books they had sold were to family and friends.

But the excitement turned to anxiety when they found that the book was not in their inventory. They had tied up with two book distributors in Bengaluru, but an error in the back-end software script meant that their website showed even the older databases of the distributors. For half a day they searched the distributor warehouse. Then they went around to all bookstores in Bengaluru. None had it. In desperation, they even called bookstores in Delhi and Mumbai. No luck.

Binny mailed to Chandra saying the book was unavailable, but they were hopeful of getting it.

And then, suddenly, one call, to Sapna Book House in Bengaluru, clicked. The store said they had a copy. Binny rushed to the shop on his bike. To his dismay, the book was a little old, the pages had turned yellow.

He and Sachin decided they would be honest with Chandra. They emailed saying the book was not in mint condition and offered a discount. “I was really impressed that they were mailing to tell me the book was not in good condition,“ Chandra recollects.

He wrote back saying if the book was readable, he didn't care about the condition. Sachin and Binny instantly bought the copy, packed it and shipped it to Mahbubnagar. Binny thinks it must have been the third or fourth day after the order was received. Chandra received the book two days later, and then left a testimonial on the Flipkart site: “The best Indian online book store I have ever seen...You guys really rock. Good luck.“ He became a regular customer. “I still order on Flipkart for my friends and family in India,“ he says.

Binny Bansal: Our site allowed customers to place an order in 30 seconds

In its first three months of business, Flipkart received 8-10 orders a week. From the fourth month, that changed to 8-10 orders a day. The numbers started doubling every third month. By the end of 2008, Flipkart was at 100 orders a day. Once they hit those numbers, the Bansals knew Flipkart would scale. Binny Bansal talks about the four things that helped Flipkart succeed where competitors of the time failed.

Focus on one category

When we started with books, our vision wasn't just to have books. But we were clear we must begin by focussing on one category. At that time, e-commerce guys were selling a lot of categories. No one was focussed on a single category. We said we won't move into any new category till we build a great experience in that one category and build a brand. We expanded from books to movies and music only after our first round of funding.

Low cancellation rate

When we showed something in our catalogue, we were sure 98% of the time that it was available. This helped us keep our cancellation rate to less than 2%. For our competitors, the cancellation rate was almost 30%. That means, one in every 3 orders would be cancelled. We would only cancel one in 50 or 100 orders. Customers got a consistent availability experience.

Speed of delivery

None of our competitors then were offering any delivery guarantee. We took a clear view that speed is important. So we started with three-day delivery guarantee across India. We met that promise with 95% accuracy. We tied up with the top three courier companies. Once an order came, we shipped it out the same day. And if we could not meet the promise, we would communicate the reasons to the customers and tell them how much time it would take. We were proactive in this, not wait for the customer to call us.

Simple Web interface

Other e-commerce sites then were generally not built by people with core technology experience. So the buying experience was clunky, not smooth or intuitive. Our website was simple and was built for fast search and ordering. If you knew what you wanted, you could be done ordering in 30 seconds.